Introduction#
Three major brokerage firms have updated their forecasts for oil prices, citing disruptions in the Strait of Hormuz caused by the ongoing conflict in Iran. This situation is tightening an already fragile global oil supply and pushing crude prices higher.
UBS Raises Oil Price Outlook#
Swiss brokerage UBS has noted that crude markets are currently "on edge" due to significant constraints on tanker traffic. According to strategist Jon Gordon, the limited progress in resolving issues at this critical energy passage has contributed to rising crude oil prices, with Brent crude trading at approximately $102.6 per barrel on Tuesday.
UBS now anticipates that Brent crude will reach $90 per barrel by the end of June, easing to $85 by the end of September and December 2026, and $80 by March 2027. Gordon emphasized that the likelihood of rising oil prices is increasing due to ongoing supply disruptions and limited spare production capacity.
Supply Disruptions and Market Impact#
Gordon pointed out that tanker loading in the Strait of Hormuz has nearly come to a standstill, while alternative export routes are operating at near-full capacity. He mentioned that a coordinated release of about 400 million barrels from OECD reserves would only partially mitigate the supply shock, as this amount is insufficient to cover potential production losses that could reach 10 million barrels per day.
Additionally, rising prices for refined products such as diesel and jet fuel could remain high, potentially exceeding crude prices. Gordon believes that due to these supply disruptions and geopolitical risks, oil prices are likely to remain elevated for an extended period, even if shipping through the Strait resumes soon.
Barclays and Mizuho Adjust Forecasts#
In a separate analysis, Barclays has also increased its oil price forecasts, suggesting that the conflict is accelerating an existing tightening trend. The bank has raised its 2026 Brent forecast to $84 per barrel, expecting prices to stabilize at a higher level than before the conflict, around $80 per barrel instead of the previously anticipated $70.
Barclays estimates that approximately 8 million barrels per day of crude production has been halted in the Middle East, alongside broader disruptions to liquid and LNG flows. They have also increased their refining margin expectations by over 110% to about $11 per barrel.
Meanwhile, Mizuho has raised its 2026 outlook for Brent and WTI crude by roughly 14% and 12%, respectively, now predicting prices of $73.25 and $68.25 per barrel. They noted that even a brief disruption could significantly tighten the market, reducing the anticipated oversupply for 2026.